Disbelief as Swan begins LNG work at Jafrabad

For at least five years Swan Energy has been talking about its proposed 5m t/y FSRU off Jafrabad port in Gujarat and many have asked aloud if the company, better known for making saris, is deluded.

But this report must admit the project has finally become a reality as site offices begin sprouting up, engineering is underway, and physical work on the ground expected to begin in mid-December. UAE-based National Marine Dredging Company (NMDC) will soon begin dredging and construction work on the 2.1-km breakwater and 600-metre 'finger jetty' - shaped like a finger - after informing the Gujarat Maritime Board.

Swan hired NMDC in September for the Rs2200cr ($321m) contract which it wants completed in 33 months. Yet NMDC is taking a risk: Swan has yet to achieve financial closure, but that is now expected to happen by end-December through merchant banker SBI Caps.

Sources tell us this should be no problem because Swan enjoys strong political support from Narendra Modi. They add that contracts for the mechanical parts of the marine work, like loading and unloading arms, a pipeline running to the shore, and the control room are expected to be awarded by April 2017.

And even though this report was told in December 2015 that Swan would be buying the FSRU from Daewoo we now learn it is actually also talking to two other South Korean shipbuilders as well: Hyundai and Samsung.

Swan wants to buy a new 170,000 cubic metre capacity FSRU which is likely to cost around $250m to construct plus $20m for spare parts and mobilisation to Indian waters. "Swan is likely to finalise the shipyard by March (2017)," we hear. "It wants the FSRU delivered within 28 months of the contract. Delivery times (for new built FSRUs) have come down sharply as yards have hardly any work these days." Swan wants its FSRU in place by October 2019 and commissioned by December 2019. R-LNG from the FSRU will be fed into the Gujarat State Petronet pipeline network about 2-km inland, adjacent to the upcoming GSPC power station at Pipavav. Gujarat State Petronet itself will lay the connecting pipeline. In August GSPC booked 1.5m t/y capacity in the FSRU while IndianOil, Bharat Petroleum and ONGC each booked 1m t/y. Swan is believed to be thinking of also installing a second 5m t/y FSRU to handle the expected R-LNG demand.

Swan wants to buy a new 170,000 cubic metre capacity FSRU which is likely to cost around $250m to construct plus $20m for spare parts and mobilisation to Indian waters. "Swan is likely to finalise the shipyard by March (2017)," we hear. "It wants the FSRU delivered within 28 months of the contract. Delivery times (for new built FSRUs) have come down sharply as yards have hardly any work these days." Swan wants its FSRU in place by October 2019 and commissioned by December 2019. R-LNG from the FSRU will be fed into the Gujarat State Petronet pipeline network about 2-km inland, adjacent to the upcoming GSPC power station at Pipavav. Gujarat State Petronet itself will lay the connecting pipeline. In August GSPC booked 1.5m t/y capacity in the FSRU while IndianOil, Bharat Petroleum and ONGC each booked 1m t/y. Swan is believed to be thinking of also installing a second 5m t/y FSRU to handle the expected R-LNG demand.